EV plans to cut budget by 5 percent
East Valley School District Superintendent Christine Burgess has informed employees that next year’s budget needs to be cut by almost 5 percent, including reductions in teachers and programs.
East Valley’s March enrollment is 4,040, a loss of 700 students over seven years.
At Tuesday’s school board meeting Burgess said, “The district can no longer continue to do business pretending that higher enrollment will become a reality, or that school funding will fully fund salaries/benefits, special-need students or building funds.”
Burgess said the district will begin a process, as outlined in collective bargaining agreements, for the 2007-08 reductions. The first considerations will be for all non-mandatory or discretionary expenditures.
By contract, certified staff needs to know whether or not they’ll be rehired by May 1.
Burgess said that the district won’t be closing any buildings next fall because there’s not enough time, but the board may consider that option for the 2008-09 year.
Based on projected revenues and expenditures, the district is expected to have an ending fund balance (savings) of less than $100,000 at the end of this school year or about 0.3 percent of its budget. Most districts in the state try to maintain a fund balance between 3 percent and 5 percent.
One of the problems with the fund balance is that the actual beginning balance was $1.3 million, not the $1.9 million that was budgeted.
Burgess said the former business manager, Richard Cook, “grossly overestimated” the revenues and underestimated expenditures, but there’s no evidence of embezzlement.
Cook requested a medical leave in January and died in February.
The district hired Al Swanson, the former assistant superintendent of finance and interim superintendent for the Mead School District, as interim fiscal manager through August.
In addition to the $600,000 difference in the beginning balance, the district’s total expenditures are expected to be $500,000 more than budgeted for this year.
A hiring freeze has been initiated for the remainder of this year, and maintenance projects are on hold.
The district has borrowed $700,000 to meet this year’s expenses until it receives levy funds available in May.
It’s not unusual for districts to have cash flow problems this time of year, but many districts are able to borrow from their capital project funds (building funds) to get by until May. East Valley doesn’t have any capital funds to borrow from because the district hasn’t had a bond since 1996.
East Valley isn’t the only Spokane-area district proposing budget cuts next school year. Spokane Public Schools plans to reduce its budget by 3.7 percent next year.